MCV INTERVIEW: Rod Cousens on... Wii U, Vita, EA and pre-owned

The veteran Codemasters CEO has no qualms about speaking his mind, particularly when it comes to the UK games industry.

And with those E3 announcements still fresh in the memory and Christmas nearly upon us, Christopher Dring sat down with the man himself to discuss everything from the challenges at retail to the prospects of Nintendo’s Wii U.

COUSENS ON... WII U AND FUTURE CONSOLES

It is in the interests of the industry for the new format to work and it is obviously a signal for the next generation of consoles. Consoles – even in the projections until 2015 – are still going to be about 50 per cent of the world’s market.

If you look at it across the whole divide of interactive entertainment, you can see the business continuing to grow, albeit in different forms, and if new formats can stimulate that then it is a good thing.

In terms of Wii U, the interesting aspect is timing and price and that has not been announced.

Everybody knows it is coming. I anticipate further price cuts on existing consoles prior to Christmas this year, and there’s room for further price cuts next year.

So Wii U needs to be very keenly priced – and in the same way that Sony is having to price Vita when the competition is smartphones and tablets. Pricing is critical in a very fragmented hardware space. So I am not sure they are going to be able to come out and hit a premium price point from the outset.

But Nintendo is smart. It is always innovative. It has demonstrated its breakthrough ability in the past, so let’s see if it can do it again. And the industry should cheer it on.

We will be doing Dirt and F1 for Wii U.

COUSENS ON... KINECT'S PITFALLS

When someone can show me a compelling business model with an attach rate that is 10-to-one rather than one-to-one, and in some cases sub one-to-one, then we will look at it as a potential space.

You can’t ignore the fact that two significant global corporations putting in a lot of money behind motion control. But I just hope they are not wasting their money.

I am not convinced as yet. Aside from the odd product like Dance Central, there is not much that I see that says we should go into this area. That may change. But I’d rather be a follower than a leader in that space. I think Microsoft did an extraordinary E3 presentation. But think about it. It started with Modern Warfare and ended with Halo. That is all they need to say.

COUSENS ON... MODERN WARFARE 3 VS BATTLEFIELD 3

You couldn’t walk around E3 without being overwhelmed by Modern Warfare and Battlefield. That is the battle royale this Christmas.

The work that EA has done over the past three years is now evident for all to see. I would say they are on the rise big time.

I respect them as a company, and admire the quality of their various products. They tick all the segments of the industry and they are morphing into a digital giant.

They are trailblazing for everyone else and addressing emerging gaming segments and gaming business models. I applaud them.

COUSENS ON... CODEMASTERS' SUCCESS

If you measure Operation Flashpoint against Call of Duty or Battlefield, it doesn’t compare. We know we can’t fight in that space, that’s not us, we are not prepared to take that degree of development risk or marketing spend. But we don’t need to.

Our games are all built around an ROI model that’s typically in the 1.5m unit range, and with that we can compete.

I am interested in making money. I am not interested in targeting a 4m unit seller and not getting there. When you have both traditional gaming companies and social gaming companies that, on the most part, aren’t making money, someone needs to examine themselves and the business model.

We can produce a 9/10 game in Dirt, at a competitive development cost, and sell more than 1.5m units. That is good business. I’m not interested in $100m development budgets. I will let EA and Activision fight that out.

We think we are difficult to beat in racing. We aren't complacent about it but we don’t fear anyone either.

I am proud of this British company. I think we command respect and the people that work for us are incredibly talented. The fact that we can be distributed in the US by companies like THQ, that we get investment from one of the world’s largest companies in Reliance and that we can access emerging markets, then we can’t be a bad business.

COUSENS ON... THE POWER OF PLAYSTATION VITA

I think the price is extremely attractive. But is Vita the future in terms of portable interactive entertainment? They don’t need me to tell them this, but the competition now is Apple and other tablets.

So the question is what is going to make Vita stand out? Partly it is price and partly it is business model. People need to work out how to make money on Apple devices – some can and some can’t. Apple certainly can. Is Sony going to offer a compelling business model, which will attract content, which will then give it some differentiation out there? It will be a huge challenge.

COUSENS ON... THE STATE OF THE MARKET

Titles like COD and GTA have a marked impact on the year-on-year sales comparisons. Software causes the spikes. If you analyse the market on a genre basis and look at sales over five years, the spikes have actually been caused by dance and Guitar Hero. The other genres have remained steady.

People are not spending as much money as they were. And I do think second-hand sales have had an impact. Regardless of what retailers try to posture about traffic in-store and so on, publishers need to pay more attention to used games. Wake up and smell the roses and understand where that is all going, because those arguments are not valid.

If you factor that all in, the situation isn’t that bad. Video games as a global publishing medium have grown year-on-year and the outlook is they will continue to do so. I don’t know many industries you can say that about.

COUSENS ON... RETAIL IN THE DIGITAL WORLD

If retailers are smart, they will embrace digital. Look at what GameStop is doing. It is not looking at digital as an enemy but as an opportunity.

Those retailers that do not respond to it as an opportunity will suffer the consequences. If you fail to strategically embrace the digital opportunity, then you get what you deserve.

You have to look at it on a global basis. Some territories are more advanced than others in terms of broadband infrastructure.

So the suppliers that retailers are talking to today are not going to give up on boxed games. But it is a changing landscape.

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